Saudi Aramco IPO delayed until 2019?

12 Mar in 14:00

Saudi Aramco’s listing is unlikely to go ahead this year, according to British officials who have been warned by their Saudi counterparts that the world’s biggest flotation was expected to be delayed, Financial Times reported.

Several people briefed on the talks said London still had a good chance of securing the listing, which Riyadh said could value the state energy company at $2tn, but any foreign flotation was likely to happen in 2019 at the earliest.

Saudi Arabia wants to sell 5% of the world’s largest oil-producing company as part of an economic reform programme driven by the crown prince Mohammed bin Salman.

The kingdom had targeted a late 2018 listing, with shares to be sold on Saudi Arabia’s Tadawul exchange. But preparedness for the offering and willingness for a simultaneous or sequential flotation on a foreign exchange has been questioned.

Delays on IPO decision making came as advisers struggled to achieve the $2tn valuation that Prince Mohammed wants. Saudi Aramco’s finances and internal operations have been shrouded in secrecy for decades and its close relationship with the state has raised financial, legal and regulatory challenges.

UK officials said that if Riyadh decided to list abroad they expected a domestic and foreign listing to take place around the same time. One person close to the talks said this could take place in the first or second quarter of 2019.